Recording Transactions in Business: A Comprehensive Guide

Recording Business
Transaction

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Part A...........................................................................................................................................3
Part B.........................................................................................................................................11
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
In a business a range of transactions are done on a daily basis under which both financial and non
financial activities are included. This is essential for companies to record the financial
transactions in a systematic manner so that financial statements can be produced effectively and
correctively (Tillman, 2017). The report is based on different kinds of financial transactions on
which various types of financial reports are produced like income statements, balance sheet and
many more. Apart from this, such produced statements are used to compute ratios in order to
assess financial performance of given business.
MAIN BODY
Part A
(a) Preparation of double entry in T-accounts.
Double entry system can be understood as a form of fundamental concept which is used to record
day to day business transactions in the accounting books of a business (Harkiolakis and Halkias,
2016). These prepared journal entries are used for further basis like preparation of trial balance,
ledger accounts and many more. Below preparation of double entries is done in such manner:
Date Particulars
L.
F Debit Amount Credit Amount
2020
01/10/20 ......Bank A/c Dr...... 8000
......Cash A/c Dr...... 5200
......Van A/c Dr...... 3000
......To Capital A/c 16200
(Being business started)

02/10/20 ......Laptop A/c Dr...... 1000
......To Bank A/c 1000
(Being laptop purchased)
04/10/20 ......Purchase A/c Dr...... 2450
......To Toy Ltd 2450
(Being purchase made)
05/10/20 ......Bank A/c Dr...... 1500
......To Sales A/c 1500
(Being sales made)
12/10/20 ......Repairs A/c Dr...... 80
......To Cash A/c 80
(Being cash paid for repairs)
18/10/20 ......Toy Ltd A/c Dr...... 100
......To Purchase Return A/c 100
(Being purchase return made)
21/10/20 ......Bank A/c Dr...... 500
......To Rent A/c 500
(Being rent received)